Let’s be clear. In 2011, we ran a deficit of $1.645 trillion. I am not advocating eternal, deep deficit spending. That is obviously unsustainable. But right now, if we trim $1.645 trillion in deficit spending from the 2012 budget, that is not going to result in more cash in anybody’s pocket. Quite the opposite The reason it is deficit spending is we aren’t collecting enough in revenues to cover it. If we trim that spending and also cut taxes by $1.645 trillion we will still run the exact same deficit and still run up the national debt by the same amount.

If we trim $1.645 trillion from the budge, that means that $1.645 trillion that would have been spent by the government and would have gone eventually into pockets in the private sector won’t go there. So how will having $1.645 trillion less in consumers’ and businesses’ hands suddenly stimulate a massive growth in private sector jobs? That $1.645 trillion currently gets spent with businesses and paid in salaries to federal workers, government contractors and employees of companies who sell to the government. These people then use that money to go shopping and to pay their mortgages. Take $1.645 trillion away, and you take away the government orders to business, and the paychecks, and the ability to go shopping or pay the mortgage. You get more business layoffs and more foreclosures, not an economic boom.

I’m not saying we shouldn’t cut. I am just saying that its a fools errand to believe that massively slashing the money available to consumers and businesses will create an economic boom. It will create a major recession. Let’s be aware of that before going in. Because whatever political side presides over the biggest cuts will blame the resulting recession or depression on the other side.

What do you think we should do to tame the debt monster once and for all?